LePage’s plan for special ‘Open for Business Zones’ rejected by Senate

AUGUSTA — The Democratic-led state Senate delivered a blow Friday to Gov. Paul LePage’s proposal to create “Open for Business Zones,” that, among other things, would have exempted large companies from requiring employees to pay union dues

The 22-13 vote to accept an ought-not-to-pass report from the labor committee effectively kills LePage’s bill, although the House has yet to vote on the measure.

Additional Photos

In this March 10 file photo, Gov. LePage criticizes the state’s Legislature during a news conference where he touted his “Open for Business Zones” proposal in Brunswick, Maine. The Maine Senate rejected the proposal Friday, April 11, 2014. The Associated Press/Robert F. Bukaty

Related Headlines

LePage blasted the vote in a statement after lawmakers adjourned for the day, saying it was “just the latest attack by job-killing liberal politicians on our efforts to improve the state’s business climate and create careers for Mainers.”

When LePage announced the proposed zones during his State of the State address in February, and then elaborated on the proposal during an event last month in Brunswick, he said he wanted to give Maine a better chance of competing with other states to attract large employers.

Only companies that invested more than $50 million and created at least 1,500 jobs would have been eligible. They would be given a 100 percent corporate tax credit for the first 10 years and a 50 percent credit for the next 10; sales tax exemptions and reimbursements for as long as 20 years; and annual reimbursement to businesses under the Regional Greenhouse Gas Initiative Trust Fund to lower energy costs.

LePage designated the former Brunswick Naval Air Station and the former Loring Air Force Base in Limestone as the two best choices for these zones. The governor’s proposal has been likened to the Pine Tree Zone program, which was created under Democratic Gov. John Baldacci, with one major difference: LePage’s bill would create “right-to-work zones,” where companies would be exempt from collective bargaining requirements.

Sen. John Patrick, D-Rumford and a member of Local 900 of the Steelworkers Union, on Friday called the bill “the new corporate welfare model,” and used the phrase “right to work for less” in his opposition to the measure.

“This is now the third time (we’ve rejected ‘right to work’),” said Patrick, who works at the NewPage paper mill. “How many times are we going to say in the state of Maine that we don’t value our working men and women? Because that’s what this does.”

Don Berry, president of the Maine AFL-CIO, called the measure a “campaign gimmick.”

“L.D. 1835 is not a real economic development strategy or plan,” Berry said. “This is ‘lottery ticket’ economic development from the LePage administration – wishing and hoping that if we give away enough tax dollars some big company will magically come. It doesn’t work.”

The governor said last month that the states that have recently attracted large businesses are all right-to-work states. He said Maine is not ready to be a full right-to-work state yet – as shown by the rejection of two bills proposing it in the past three years, including one that was rejected by a Republican-controlled Legislature. But his bill could be a pilot project to show Mainers that it works, LePage said.

Sen. Ronald Collins, R-Wells, agreed that the bill would help level an uneven playing field among Maine and other states.

“Maine has a lot to offer,” he said. “But it’s a very competitive arena out there.”

In his reaction statement Friday, LePage pointed to several legislative actions that, in his view, damage the business climate in Maine. One bill approved by the Legislature would penalize call centers that move jobs overseas. In another vote, lawmakers rejected a proposal by LePage to hold an advisory referendum on whether voters wanted tax relief in exchange for $100 million in state spending cuts.

Also, legislators rejected the governor’s proposal to streamline the work permit process for children younger than 16 and allow older teens to work in bowling alleys and movie theaters.

“These liberals have pursued their anti-business agenda with a vengeance this session,” LePage said.

It’s not clear how much interest the state would receive from large companies looking to relocate or open new locations in Maine.

A recent report by the Brookings Institution said that 95 percent of all job gains annually in an average state come from within, as existing businesses expand and entrepreneurs create new businesses.

In 2013, Maine had 13 companies with more than 1,500 workers, according to a list of the top private employers compiled by the state Department of Labor. The top two are retailers – Hannaford and Walmart – whose employees are spread all over the state. Also on the list is the Shaw’s supermarket chain. Five of the largest employers are hospitals.

The only companies on the list that would fit the definition of manufacturing – the type of business the governor wants to attract – are Bath Iron Works, a shipbuilder that relies mostly on government contracts, and Verso Paper, a paper company with a mill in Bucksport that will get even bigger if it acquires NewPage Holdings in a $1.4 billion deal that was announced in January.

Here at MaineToday Media we value our readers and are committed to growing our community by encouraging you to add to the discussion.

To ensure conscientious dialogue we have implemented a strict no-bullying policy. To participate, you must follow our Terms of Use. Click here to flag and report a comment that violates our terms of use.